WAGENINGEN (The Netherlands): Sime Darby Bhd (4197) aims to rapidly expand its palm oil processing operations in China to meet rising demand for cookies, ice-cream and instant noodles from the country's growing middle class, its chairman said on Thursday.
Tun Musa Hitam said the global economic crisis had not affected the rising demand trend for palm oil and, while the European market was stable, demand in China, India and the Middle East was still increasing sharply.
The conglomerate is developing palm oil processing for cooking oil in China, but Musa said it was already talking about increasing the scope of its downstream operations in that country to include more vegetable oil-based food ingredients.
"The bigger the middle class that exists in a country, the more they consume palm oil," he said.
"The essential needs were just ordinary oil for cooking and frying. As the middle class grows, they come to be interested in cookies, ice-cream, or noodles," he told a food conference in the Netherlands.
Musa said it was not unlikely that Malaysia's annual palm oil exports to China could double in the next decade, from a level of around four million tonnes at present. He also expects growing Chinese investments in palm oil in countries such as Malaysia.
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"The Chinese are interested in two things: security of supply of energy and food. The beauty of palm oil is that it can be considered food and energy," he added. - Reuters
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